What Are Medicare Advantage Plans in California?
Are you signing up for Original Medicare, but worried it won’t offer enough coverage? Original Medicare, or Medicare Part A (hospital services) and Part B (outpatient and preventive services), generally doesn’t cover prescriptions, and there’s no cap on out-of-pocket costs. Medicare Advantage plans, or Medicare Part C, may be a good option. These plans include Original Medicare coverage but are provided by private insurance companies, which must follow Medicare guidelines. Medicare Advantage (MA) plans in California typically offer prescription drug coverage, otherwise known as Medicare Part D.
What You Need to Know
Medicare Advantage plans must include Medicare Part A and B coverage.
MA plans typically use a network of doctors and medical facilities.
While some MA plans carry no premiums, others have a monthly cost.
What Types of Medicare Advantage Plans Are Available?
You can choose among several types of Medicare Advantage plans in California:
- HMO: Health maintenance organization, which limits members to a contracted provider network. You generally need to choose a primary care provider (PCP) and get referrals to see specialists.
- PPO: Preferred provider organization, which offers greater choice than an HMO but at an increased cost. You don’t need to choose a PCP or get referrals for specialists.
- SNP: Special needs plans, for patients needing specialized care. There are three kinds:
- PFFS: Private fee-for-service. The plan determines how much it will pay for care and how much you’ll pay. You won’t need to choose a PCP.4
- MSA: Medicare medical savings account, a hybrid of a high-deductible plan and a medical savings account to cover your medical costs before you meet your deductible.5
A Word of Advice
You’ll save money in an MA plan by going to in-network providers.
What Are Prescription Drug Options with Medicare Advantage?
Prescription drug coverage under Medicare Advantage comes in two options: a separate plan or as part of your MA plan. In California, you can switch to a Medicare Advantage prescription plan if you’re enrolled in a plan that doesn’t have this coverage.
Under a Medicare Advantage prescription drug plan (MA-PD), most MA HMOs and PPOs in California provide prescription drug coverage. PFFS plans allow you to sign up for prescription coverage separately if the plan doesn’t include it.
Whichever plan you choose, check its drug formulary, or list of approved medications, to make sure your prescriptions are covered.
How Do You Choose Medicare Advantage Plans?
To pick the right Medicare Advantage plan, you’ll need to look at a few factors.
Premiums are the amount you pay monthly for coverage. Zero-premium plans are available, but your other costs might be higher as a result.
The plans that carry premiums vary when it comes to monthly cost.
Other costs include:
- Coinsurance, the amount you pay for services after you meet your deductible. Generally coinsurance is 20%.
- Copays, a standard amount that you pay for most services.
- Deductibles, the amount you need to pay yearly before your insurance kicks in.
- Maximum out-of-pocket, which in 2021 is typically $7,550.6
Plan benefits include:
- Vision, such as exams and glasses fittings.
- Dental, such as exams and cleanings.
- Telehealth, including office visits, consultations and psychotherapy.
- Other perks, including access to fitness programs and hearing aids.
Good to Know
Medicare Advantage plans typically offer vision and dental coverage in addition to Original Medicare.
When Can You Enroll in Medicare Advantage?
You can sign up for Medicare Advantage as soon as you’re eligible for Medicare, during the period from three months before you turn 65 to three months after you turn 65.
A few things to know:
- The Medicare Advantage Open Enrollment Period runs from January 1 to March 31. This is when you can switch to a different Medicare Advantage plan with or without prescription drug coverage.
- The Annual Election Period, or Open Enrollment Period, for Medicare is October 15 to December 7. Medicare members can change their plans for the following year.
- The General Enrollment Period runs January 1 to March 31. You can sign up for Medicare if you didn’t when you were first eligible, then sign up for an MA plan afterward.
- The Special Enrollment Period allows you to enroll under certain circumstances, including:
- Loss of coverage, or losing Medicaid eligibility
- Gain of coverage, or qualifying for employer or union coverage
- Plan changes, such as Medicare termination of a current plan’s contract
- Developing a chronic condition that would be best served by another plan
How Much Do Medicare Advantage Plans Cost in California?
In 2020, the average MA plan in California9 cost $22.39 a month. Costs vary by your location as well as other factors. In San Francisco, for example, MA plans range from $0 to $398 monthly. In Los Angeles, they range from $0 to $396 monthly.10 You’ll want to consider costs other than the premium, such as deductibles and coinsurance, when choosing a plan.
What If You Want to Change Your Medicare Advantage Plan?
If you’re already enrolled in Medicare Advantage in California, you can join the plan you want during one of the open enrollment periods. When you switch plans, your old plan is automatically canceled as your new one kicks in.
What Are Alternatives to Medicare Advantage?
There are a few alternatives to having a Medicare Advantage plan:
- PACE:11 Programs of All-Inclusive Care for the Elderly. These are medical and social services for a specific group of beneficiaries who must meet the following conditions:
- 55 or older
- Nursing-home care eligibility
- Ability to live safely in a community
- Live in a PACE service area
- Original Medicare. If Medicare Part A and B provide enough coverage for you, you can stick with it.
- Medicare Supplement plan. Also known as Medigap, these policies, provided by private insurers, can help pay costs not covered by Original Medicare.
- Medicare Supplement with a Part D plan. You’ll likely need separate prescription drug coverage with a Medigap policy.
What Are Medicare Resources in California?
- Health Insurance Counseling and Advocacy Program (HICAP).12 This program helps beneficiaries enroll in Medicare and offers answers to questions and other resources.
- California Department of Insurance.13 This offers information and advice about your Medicare options.
- Medicaid.14 Medi-Cal, the Medicaid program in California, is a joint federal and state program that provides coverage to those with low income or a disability.
If a Medicare Advantage plan best fits your needs and your budget, reach out to an enrollment agency or to Medicare to find an insurance company. Make sure you’re picking the level of coverage and the costs that work for you before you sign up.